Channel Resources Ltd.
TSX VENTURE : CHU

Channel Resources Ltd.

November 17, 2010 13:30 ET

Channel Resources Reports on Interim Results From Fox Creek Lithium/Potash Brine Project Process Testing Program

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 17, 2010) - Channel Resources Inc. (TSX VENTURE:CHU) -

  • Encouraging baseline recoveries of target minerals
    • Greater than 95% of lithium to intermediary compound
    • Up to 88% of bromine as elemental product
    • Up to 100% of boron as sodium borate
    • Approximately 40% potassium as carnallite
  • Additional testing underway
  • Project resource estimate commissioned

Channel Resources Ltd. ("Channel" or the "Company") is pleased to provide a report on progress made on process test-work performed on mineralized brine at the Fox Creek Lithium / Potash Brine Project ("Fox Creek"), located in Alberta.

Channel is evaluating a variety of methods to identify optimal processes to extract lithium, boron, potassium, bromine and other potentially economic products from brine already being produced as a by-product from a large group of natural gas wells on the Fox Creek permit.

Results indicate that all four primary products can be extracted, including over 95% of the lithium to an intermediary compound, up to 88% of elemental bromine, up to 100% of the boron as sodium borate, and approximately 40% of the potassium as a carnallite salt.

Hazen Research, Inc. in Golden, Colorado has conducted all laboratory tests from a bulk sample of brine supplied by Channel earlier in the year. The program is designed to identify the potential of a suite of processes to recover target minerals from the brine and to estimate reagent consumption for each process, providing a basis for flow sheet design, engineering, as well as scoping and feasibility studies. 

Recovery of Mineral Products from Feed Brine

A variety of tests were made on 'feed' brine prior to any concentration of minerals in the brine through evaporation. Results indicate that over 95% of the lithium in the feed brine can be recovered to an intermediary compound and simultaneously concentrated by a factor of 13.5. Extracting lithium from the feed brine to this compound effectively removes it at an early process stage from potential contaminants and may allow for higher overall recoveries. Various second-stage processes will be assessed to maximize the recovery of lithium carbonate as an end-product from the intermediary compound.

Using a chlorination/steam stripping process on the feed brine, bromine recovery of 73% was achieved.

Recovery of Mineral Products from Concentrated Brine

Evaporation of the brine was conducted to precipitate various salts in sequence and to increase the overall concentration of elements. Target elements were recovered from precipitates and the concentrated brine as follows:

Element Recovery Recovered Product Testing Method(s)
Potassium 40% Carnallite Staged evaporation
Bromine 88% Bromine Chlorination / steam stripping
Boron >95% Sodium Borate Solvent extraction / sodium hydroxide stripping
Lithium Up to 50% Lithium Chloride Solvent extraction

Further work demonstrates that potash (potassium chloride) can be separated from the carnallite with a greater than 70% recovery of potassium.

The tests also demonstrate that large quantities of salt (sodium chloride) can be produced from the brine through the evaporation process and could become a valuable by-product of brine processing at Fox Creek. 

Further Testing Underway

Further testing has been initiated, focused initially on evaporation tests on brine that has been pre-treated to reduce overall calcium content, thereby allowing for a greater factor of concentration and the potential for greater recoveries of potash and lithium. The recovery of boron from the feed brine will also be tested using solvent extraction methods to compare with that from the concentrated brine. It is expected that these tests will be completed by the end of the first quarter of 2011.

Resource Estimate Commissioned

Based on the positive results of process testing received to-date, Channel has commissioned a National Instrument 43-101 Resource Estimate on the mineralized brine aquifers at Fox Creek. The study will be coordinated by APEX Geoscience Ltd. ("APEX") of Edmonton, AB, and is expected to be completed in the second quarter of 2011.

"While process test-work has taken longer than initially anticipated, the results are providing a strong basis on which to make critical engineering, costing and development decisions for the Fox Creek Project," commented Colin McAleenan, Channel Resources' President and CEO. "We are particularly encouraged to be able to extract both lithium and bromine directly from the feed brine at such high rates. As soon as we establish the optimal suite of processes for producing our target minerals, we will move quickly through scoping and the various other steps necessary to move the project towards a production decision."

Channel Resources Ltd. maintains a rigorous quality control program involving the collection and testing of brine samples. Of the original 2,000 litres of brine collected in March of 2010, 1,500 litres was shipped to Golden, Colorado in sealed containers where it has undergone testing by Hazen Research, Inc., a recognized expert in the field of brine processing technologies. The head grade of the brine as submitted to Hazen was 59.4 mg/L Lithium, 3,840 mg/L Potassium, 404 mg/L Bromine and 122 mg/L Boron. Hazen tested the brine in controlled laboratory conditions applying extraction methods that include the traditional 'salting out', solvent extraction and adsorption processes targeting the commercial mineral products. Five hundred litres of brine remain in a secured location as a reference and control sample. This news release has been prepared under the supervision of Colin H. McAleenan, P.Geo, who is the Company's "Qualified Person" under the definition of NI 43-101. Readers are encouraged to review the 43-101 technical report for the Fox Creek Project authored by Michael B. Dufresne, M.Sc., P.Geol., President of APEX Geoscience Ltd. of Edmonton, Alberta, who is an 'Independent Qualified Person' as defined in the instrument.

Channel Resources Ltd. is a Canadian TSX.V listed mineral exploration Company with an option to earn a 90% interest in the Tanlouka Gold Project in Burkina Faso, West Africa and an option to earn 100% in the Fox Creek Lithium / Potash Brine Project in Alberta. At Tanlouka, a major drilling program is expected to begin in November 2010 to follow up on new mineralized zones that were discovered earlier in the year, and to follow up on targets for new discoveries. At Fox Creek, a bulk sample of brine sourced from producing natural gas wells is undergoing process testing to determine the most efficient method of producing various industrial minerals from the brine, including lithium carbonate, potash, bromine and borates. The Company is financed to advance both projects through their current programs, and is actively searching for additional opportunities to expand its project portfolio.

Some of the statements contained herein are forward-looking statements which involve known and unknown risks and uncertainties. Without limitation, statements regarding potential mineralization and resources, exploration results, and future plans and objectives of the Company are forward looking statements that involve various degrees of risk. The following are important factors that could cause the Company's actual results to differ materially from those expressed or implied by such forward looking statements: changes in the price of minerals, general market conditions, risks inherent in mineral exploration, risks associated with development, construction and mining operations, the uncertainty of future profitability and the uncertainty of access to additional capital. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements or the foregoing list of factors, whether as a result of new information or future events or otherwise. Further disclosure on risk factors is available in the Company's various corporate filings at www.sedar.com.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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